OC's season is good, but no record

Merchants fault weather, high price of gas, hotel rooms

`Very, very, very slow'

Number of visitors is less than in 2000, but could pick up

September 02, 2001|By June Arney | June Arney,SUN STAFF

OCEAN CITY - Weeks of cool weather and a wobbly economy dampened summer sales for most Ocean City businesses, leaving some owners and managers praying for a good fall to help make up for a less-than-sensational season.

"It's been very, very, very slow," said Ray Flair, Manager at Mikes Bikes, which has two locations near the Boardwalk in Ocean City. "If we could get a good September and October, we might break real close to coming up to last year."

Revenue at the bike rental's 1st Street location, which gets most of its business from the local hotels, is off about 2 percent despite a $1-an-hour rate increase, the first in nine years, he said.

He said the South Division Street shop, which pulls its business from the high-rise condominiums at the north end of the strip, may come close to breaking even, or dip just a few percentage points below last year's rental income.

A telling indicator of less-than-capacity crowds, Flair said, has been the scarcity of "no vacancy" signs - something he watches for as he drives to work. "At any given time, I doubt I saw more than four `no vacancy' signs," he said.

Ride operators, retailers and hotel operators elsewhere on the 10-mile-long barrier island echoed Flair's observations. Tourism officials acknowledged that the resort likely will end the season shy of the 4 million visitors in 1999 and 2000, both banner years.

"The season has been a good one but not record-breaking," said Donna Abbott, a spokeswoman for the town's department of tourism. "There were a lot of people in town but not what we're used to. I think the cooler weather just wasn't putting people in the mood for summer."

The seaside resort had 2.39 million weekend visitors during June and July, compared with 2.53 million visitors during those months in 2000, according to tourism office estimates.

The first four weekends of August brought an estimated 1.20 million visitors this year, compared with an estimated 1.23 million weekend visitors in 2000.

And while room taxes collected in earlier months were up - 9.9 percent in May and 26.5 percent in June - the increase was more likely due to higher prices than more visitors, said Martha J. Bennett, town finance administrator.

Room tax collections for July, the most current figures available, were just 1 percent above July 2000 collections, she said.

"We didn't feel like we were that mobbed in June, so we think it's because the rates were fairly high," she said. "Food and beverage sales would have been up if there were more people here."

While May food and beverage tax receipts were up 7 percent, June's were down about 3 percent, she said.

Last year, tourists spent an estimated $400 million on food, drinks and lodging in June, July and August, according to the tourism office.

At the Majestic Hotel, a landmark on the Boardwalk at 7th Street since 1925, June business was down 30 percent and July business by 3 percent, said Will Savage, a manager.

August should end about equal to last year - an outstanding month at the top of a good five-year run, he said. Still, so far this summer, business is down between 5 percent and 10 percent compared with 2000, he said.

`We can make it up'

"It definitely started out slow," Savage said. "We can make it up if September is good and there are no storms."

Savage blames the weather and the economy - not the addition of 450 hotel rooms to the resort - for the downturn. This season the Holiday Inn Hotel & Suites opened 132 luxury suites at 17th Street and the Grand Hotel opened 251 rooms at 21st Street, both on the Boardwalk.

"We have our own little niche," Savage said. "We have families who come year after year. This is a quiet hotel."

The two new hotels said the summer has gone well for them. The Holiday Inn Hotel & Suites had almost 100 percent occupancy almost every day, according to Betsy Cohill Faunt Le Roy, a spokeswoman for the Harrison Group, which owns and operates them.

"They took off right away," she said. "We exceeded our expectations. We believe the uniqueness of the property drove reservations during a flat market."

The first 100 suites opened in mid-May and the remaining 32 in late June, she said.

The Grand Hotel's first season also went well, according to owner Mario Rinaldi.

Rentals, too, have been softer. This summer has not had the volume of sold-out weeks of past years, said Susan B. Holt, vice president and regional director for O'Conor, Piper & Flynn ERA, which handles 2,500 rental properties from Ocean City to Lewes, Del.

Renters now buy

"People seemed to book their weeks a lot later," she said. "It seems that with the strong economy we've had in recent years, the people who were able to rent have bought and put [the property] back into the rental market. So you've essentially increased the properties and decreased the renters."

Overall, this year will top last for the agency because of good business during off-peak months, she said.